Following the launch of Greenpeace’s Clean Our Cloud campaign, Microsoft said last month that it would put an internal price on its carbon usage and adopt a goal of “carbon neutrality”. This was a clear step that showed Microsoft has started to listen to its customers who want a clean cloud.

But the devil is in the details, and the details show that Microsoft’s actions so far may help to clean up its reputation, but are failing to clean up its cloud.

Microsoft’s “carbon neutral” plan allows it to keep building data centres that rely on coal, such as its new investments in Virginia and Wyoming in the United States, yet claim to be carbon neutral by buying renewable energy credits (RECs).

RECs are a method of carbon offsets that allow companies to pay for credits that supposedly help finance other renewable energy projects, while not receiving the actual electricity from that project. In other words, Microsoft’s use of RECs means that no less coal is burned and no more renewable energy is produced to power its cloud.

Apple is pursuing a similar strategy to try to quell the controversy over its data centre in North Carolina.

Like Apple, Microsoft has far better clean energy options than simply paying to paper over its coal problem. Google, for example, has invested more than $900 million in clean energy investments without the use of RECs and is actively pushing for stronger clean energy and climate policies. Facebook has a specific policy expressing a preference for renewable energy when it builds new data centres.

If Microsoft matched or exceeded those efforts, it would catalyze a shift from dirty to clean electricity and create the scale of positive change that Microsoft could be proud of.

Microsoft’s new internal carbon fee could hold the most promise for the company’s growth as a clean energy leader. Microsoft is saying that since there is no effective price on carbon in the external world, it will charge a fee to its own departments and operations for how much carbon they use.

It’s a good idea, and hopefully it will lead to an improvement in Microsoft’s decision making and prompt it to actively advocate for effective carbon pricing policies from the US government. After all, if Microsoft can do it, surely it can ask the government to do the same.

But if Microsoft’s internal carbon fee and new “carbon neutral” goal result only in more carbon offsets, then both will be wasted opportunities.

Microsoft should move quickly to back up its rhetoric by committing to renewable energy for its growing data centre fleet without the use of RECs, and using its influence to demand a shift away from dirty energy, as Google and Facebook have already done.